June 1, 2005

market forecast, manufacturers directory and review of machinery companies serving the market

The adult incontinence market has had its share of ups and downs over the years. While no one can question its potential for growth�thanks to a growing aging population and increased awareness of male and female incontinence issues�key challenges, including consumer education, a threat of surgical and medicinal antidotes to incontinence and pricing pressures, have made doing business in this segment challenging.

In the past several years, adult incontinence sales around the world have grown steadily. According to market tracking agency Euromonitor, sales of just under $1.6 billion in 1997 grew to $2.1 billion in 2002. This growth is expected to continue with sales reaching $2.7 billion in 2007. A look at world regions shows a similar picture with all of the major world areas excluding Latin America due to its recent financial crises, reporting steady growth in past years, which is expected to continue to 2007.

By and large, the adult incontinence market can be subclassified into two segments�retail and institutional. According to industry observers, the size of these two segments is fairly similar; however, marked differences exist between them. The retail side of the business is largely driven by comfort, discretion and ease of use and consumers show fierce brand loyalty. Simply said, once a person finds an adult incontinence product that works, he is apt to use that product regardless of price. Meanwhile, the institutional market is much more price driven. Purchasing departments want products that not only cost less but also require less application time for their employees. Comfort and discretion, while increasing somewhat in importance thanks to increased family intervention, often take a backseat to pricing concerns.

A Common Problem
According to the National Association for Continence, in 1996 some 13 million Americans were incontinent. Of these, 85% were women whose affliction was often caused by childbirth, dementia or concurrent illnesses. More recently, however, the association found that one in four women above the age of 18 experience episodes of leaking urine involuntarily. One in five adults older than 40 are afflicated with an overactive bladder or recurrent symptoms of urgency. Furthermore, at least half of all nursing home residents are urine incontinent and many of them experience loss of bowel control as well. These sufferers experience emotional as well as physical discomfort, and many isolate themselves for fear of ridicule and lose self esteem.

In addition to far reaching, incontinence is also a diverse problem, with several types of incontinence affecting sufferers. Stress incontinence, for instance, occurs when sphincter or pelvic muscles have been damaged, causing the bladder to leak during exercise, coughing, sneezing, laughing or any body movement that puts pressure on the body. This problem, more common in women, can occur after multiple childbirths or menopause. Meanwhile, urge incontinence is the urgent need to pass urine and the inability to get to a toilet in time. This occurs when the nerve passages between the bladder and the brain are damaged. Mixed incontinence is common and occurs when symptoms of both stress and urge types of incontinence are present. Overflow incontinence refers to leakage that occurs when the quantity of urine produced exceeds the bladder�s holding capacity. It is caused by diabetes, pelvic trauma, extensive pelvic surgery, injuries to the spinal cord, shingles, multiple sclerosis or polio.

SCA’s Serenity and K-C’s Depend brands are competing for share in the adult incontinence market.

Industry Response
The many types of incontinence and the increasing number of consumers experiencing these ailments has led to some significant research in the market. Where once adult incontinence innovation tended to mimic advances in the baby diaper and/or feminine hygiene market, now the segment, particularly on the retail side, is being improved to meet consumer needs. One advancement, noted by industry analyst Pricie Hannah at nonwovens consultancy John R. Starr, Inc., is the incorporation of odor-absorbing additives directly into the core to increase the effectiveness of the product in disguising incontinence issues. �This is particularly important in pads and liners because their users are fully ambulatory,� Ms. Hannah said. �Manufacturers are really looking at the product to decide how much innovation is going into it.�

On the retail side, much of the market is controlled by Kimberly-Clark with its Depend and Poise products. K-C�s marketshare is currently estimated at about 53% in the U.S. and its product sales are growing in sync with overall market growth. Key competitors, however, include Swedish SCA, who has made several investments to its U.S. adult incontinence business in recent years, which has led to explosive growth in its Serenity/Tena brands. For instance, its Serenity Night and Day adult incontinence product, which gives users greater flexibility than many other products, and its Dri Active adult incontinence product, geared toward ambulatory incontinence sufferers, have recorded triple-digit percentage growth in the past year, according to Information Resources, Inc., Chicago, IL.

In addition to K-C and SCA, Unicharm in Japan is also spearheading innovation on the branded front, according to Ms. Hannah. In the private label market, First Quality in North America and Ontex and Hartmann AG in Europe are likewise increasing their research and development efforts in an effort to win large retail contracts.

�On the retail side of things, the potential for growth and profitability can support research,� Ms. Hannah said. �This potential has been leveraged across the different categories of adult incontinence products dependent on the needs of that category.�

For example, odor absorbers have been incorporated into panty liners for occasional sufferers of incontinence; meanwhile, more advanced sufferers, many of whom are not ambulatory, have a need for the pull-up underpants that can be side-fastened or pulled up, depending on the situation. Side fasteners allow caregivers to change patients while they are lying down, and their refastenability eliminates waste as caregivers can readjust the sides and check for soils without ruining the diaper.

Also driving innovation in adult incontinence is a consumer desire to sleep through the night. Severe incontinence sufferers often have to wake up several times during the course of a night to change their absorbent devices. Even if they can make it through the night, issues related to fit and comfort can contribute to a restless night�s sleep. These needs led to the creation of such products as the aformentioned Serenity Night & Day, according to Nancy Mueller, executive director of NAFC.

�There is definitely a trend among companies of looking at whatever it is that consumers are suffering from the most,� Mr. Mueller explained.

Competition�No Problem
As disposable incontinence products are being improved through smarter fit, increased diversity, improved efficacy and better polymer technology, they are facing some competition from alternate methods of dealing with the problem. Instead of using disposable products that could fail them in times of need, some sufferers are exploring medicinal cures for incontinence, as well as surgical procedures to correct the problem.

Despite advances in these two areas, experts are confident a place for disposable pads and diapers will always exist in the adult care market. �I haven�t seen a drug that fully cures incontinence,� Ms. Mueller said. �Medicine might reduce the frequency or the number of episodes or it might mitigate the severity of a problem, but it still needs to be paired with an absorbent device.�

Afraid of being caught having an �accident,� long-time sufferers of incontinence are not going to go without protection, even if it�s a light pad or shield for less severe disorders. Additionally, slight sufferers of incontinence, such as stress or urge incontinence, don�t want to take a pill daily for a problem that occurs only once in a while.

In terms of surgery, younger sufferers of incontinence are more inclined to correct the problem than older folks. Since the large portion of users fit into the older demographic, this is not a major threat to nonwovens.

Therefore, absorbent products companies would be smart to continue thinking of adult incontinence as a growing market. Where baby diapers and feminine hygiene items have been recording slower year-on-year growth during the past several years, adult continence remains one area where profits can still be generated.

As manufacturers continue to keep in mind the needs of both the sufferers of incontinence and their caregivers, certainly we will continue to see a broader market for adult incontinence products. �Demographics will really be the key driver for growth in the future,� Ms. Hannah said. �On the retail side, the opportunity will lie in the ability to penetrate consumers who are using makeshift solutions to mask their problems, where in assisted living and other institutional settings, a lot will depend on the patients� and their families� ability to exert influence over purchasing decision.�

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